(VitalNews.org) – The United States Department of Justice is suing Visa over a potential alleged monopoly and antitrust violations that affect “the price of nearly everything.”
Visa has allegedly suppressed competition through threats of high fees and paying off rivals, according to the lawsuit complaint that was filed in the U.S. district court in New York. The lawsuit says it is extremely difficult for merchants to use any alternative than Visa, such as lower-cost or smaller payment processors.
It’s been reported that in just the last quarter, more than three trillion dollars worth of transactions have been processed through Visa’s financial network. The firm processed more than sixty percent of debit card transactions in the United States which has brought their fees collected to over seven billion dollars, according to the Justice Department.
The Biden Administration has been attempting to tackle these types of fees, which are sometimes known as swipe fees or interchange fees, as these fees have been a key issue in the presidential elections campaign trail.
“We allege that Visa has unlawfully amassed the power to extract fees that far exceed what it could charge in a competitive market. Merchants and banks pass along those costs to consumers, either by raising prices or reducing quality or service,” said US Attorney General Merrick Garland.
He continued, “As a result, Visa’s unlawful conduct affects not just the price of one thing – but the price of nearly everything.”
Visa has said that these claims are “meritless” and it vowed to “vigorously” defend itself in the lawsuit.
“Anyone who has bought something online, or checked out at a store, knows there is an ever-expanding universe of companies offering new ways to pay for goods and services,” said the firm’s general counsel, Julie Rottenberg.
She continued, “Today’s lawsuit ignores the reality that Visa is just one of many competitors in a debit space that is growing, with entrants who are thriving.”
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